The Morning Fix: No medals for NBC Universal. Demand Media prepares IPO. DVDs down while video games are up
After the coffee. Before wishing regular Morning Fixer Joe Flint a happy one-year anniversary at the L.A. Times.
Why can't I quit you? Carl Icahn upped the ante in his bid to take control of Lions Gate Entertainment Corp., raising his hostile offer to $7 per share as he SCREAMED!! (just like that) in a letter to shareholders that they should reject the company's proposed "poison pill" that would thwart his plans. In possibly related news, outspoken Dallas Mavericks owner and indie film entrepreneur Mark Cuban has bought 5% of Lions Gate shares. Analysis from the Los Angeles Times, Hollywood Reporter, Variety and Wall Street Journal.
Maybe they should have aired "Knight Rider" re-runs instead: NBC Universal lost a tidy $223 million airing the Olympics last quarter, driving down overall profits at the General Electric Co. subsidiary (which will be controlled by Comcast Corp. next year) 49% to $199 million. Besides that predicted mess, NBC U saw more strong growth from its cable networks, some progress on broadcast ad revenue, and disappointing box office but slightly better-than-expected home video revenue from the movie studio. Analysis from Broadcasting and Cable, the Hollywood Reporter and PaidContent.
Wall Street demands Demand: Demand Media, the red-hot but controversial Santa Monica Internet company that pays freelance writers about $15 for articles on topics determined to have value from search engine advertising, is working with Goldman Sachs for a $1.5-billion initial public offering as soon as November, reports the Financial Times. PaidContent adds an interesting list of questions that could be answered by Demand's SEC filings. I wonder if Goldman will be paid more than $15 for its services?
Other than that, how was the play, Mrs. Lincoln? As DVD sales dropped precipitously last year, many in Hollywood took comfort that consumers were at least renting more movies. However, new data shows that the Netflix- and Redbox-driven surge may be over, as rental revenue plummeted 14% last quarter while sales kept on dropping. The Los Angeles Times and The Wrap report on the depressing trend.
Game industry gets a power up: The video game industry, meanwhile, got some good news as overall sales revenue grew 6% last month to $1.5 billion, thanks to hit games like God of War III and Final Fantasy XIII. The retail game industry has been in a prolonged slump, so everyone is hoping it's the start of a trend and not a blip. Analysis from the Los Angeles Times and Gamasutra.
Much ado about Harvey: First the Hollywood Reporter reported that it "looks as if" (there's a phrase to inspire confidence) the Weinsteins/Ron Burkle/Fortress and Colbeck Capital consortium will win the bidding for Miramax. Then The Wrap said no, they just have a two-day exclusive window with Disney for negotiations. Then Deadline said neither is true but negotiations continue. Disney denies anything is done, which doesn't technically deny anything. Conclusion: I wish I had never started writing this item.
Inside the Los Angeles Times: Sean Hannity is in trouble with Fox News for headlining a tea party fundraiser. "Kick-Ass" should take in about $30 million at the box office this weekend, says the paper's stunningly handsome movie projector. The new MOCA director is kicking off his tenure with a survey of art by Dennis Hopper. Kenneth Turan digs "Kick-Ass" while Betsey Sharkey disses "Death at a Funeral."
-- Ben Fritz